But most importantly it we need competition on the desktop. Like it or not, Microsoft still has a monopoly in this market. This can only be good for people who like technology.
The best part is, a game made for or ported to SteamOS (and Steam Machines) runs perfectly fine on my Arch install, played Portal 2 beta just yesterday.
By contrast, a game made for X360/XOne (Steam Machine competitor) does not by default run on a desktop OS, even Windows. The same goes for PS3/4.
You still have the fragmentation of the PC market, but much less so as optimization on the developer level can be reserved for Steam Machine hardware, I'm confident my GTX 660M will run stuff just fine even so.
That's a potentially huge win for Linux as both a desktop OS and a platform. I can easily see it snowballing, with teenagers going "Yeah, I ditched Winlol and OS-SuX for Fedora, rippin' though Crysis 4. Yo have you tried extensions in GNOME Shell? Shit's so cash", that's a culture change in favor of Open Source. Might not happen, might just happen.
/I obviously have no idea how teenagers talk these days